Foes attack McConnell for $2.9 billion in dam money included in spending and debt bill

Jim Lo Scalzo / EPA

Senate Minority Leader Mitch McConnell, R-Kentucky, walks to Republican luncheons in the U.S. Capitol in Washington, on Oct. 15.

By Tom Curry, National Affairs Writer, NBC News

After Senate Republican Leader Mitch McConnell helped broker Wednesday’s deal that reopened the government, his critics found something in that agreement they’re using to attack him with — a $2.9 billion locks and dam project.

A conservative group has pounced on McConnell for what it calls a “Kentucky kickback” – money included in the legislation to finish a troubled infrastructure project on the Ohio River between Illinois and Kentucky.

White House Press Secretary Jay Carney talks about President Obama’s reaction to news of a Senate deal to reopen the federal government and raise the debt ceiling.

But the builder of the infrastructure project, the Army Corps of Engineers, says it will bring huge economic benefits to shippers and other businesses in states from Pennsylvania to Louisiana.

At issue is the Olmsted Locks and Dam, between Illinois and Kentucky on the Ohio River as it nears its confluence with the Mississippi River – a vital passageway for barge commerce in the middle of the country. More barge tonnage passes through that stretch of the Ohio than at “any other place in America’s inland navigation system,” the Army Corps says.

The project will replace antiquated locks built in 1929, but the costs have soared since Congress authorized the replacement 25 years ago.

Senate Conservatives Fund Executive Director Matt Hoskins said in a statement that “in exchange for funding Obamacare and raising the debt limit, Mitch McConnell secured a $2 billion Kentucky kickback. This is an insult to Kentucky families who don’t want to pay for Obamacare and who don’t want to shoulder any more debt.”

Hoskins added in an e-mail follow-up on Thursday that “the inclusion of the Kentucky Kickback shows that Mitch McConnell is willing to use the debt agreement to force taxpayers to fund one of his pet projects.”

McConnell is facing a conservative primary challenger Matt Bevin.

Hoskins said his group hasn’t endorsed a candidate in the Kentucky race and has not made any independent expenditures in the race.

In a campaign video on Thursday, Bevin criticized the agreement which McConnell negotiated with Senate Majority Leader Harry Reid, but he didn’t specifically criticize the money for the Olmsted Locks and Dam.

Bevin said the Reid-McConnell agreement not only did not defund or delay the Affordable Care Act, but “doesn’t even put us on a path to financial sustainability.”

As for the Olmsted project, Bevin campaign spokeswoman Sarah Durand said, “Matt does not support earmarks no matter who requests them, but more importantly, Obamacare is still fully funded and President Obama now has another blank check to spend more money we don’t have. Mitch McConnell sold us out.”

The campaign for McConnell’s Democratic opponent, Alison Lundergan Grimes, did not return phone calls seeking comment on the money for the Olmsted Locks and Dam project.

After calling the inclusion of the $2.9 billion in funds “disgusting” on Wednesday night, Sen. John McCain, R- Ariz., said on Twitter Thursday, “I do not believe that Senator McConnell was responsible for the ‘anomaly’ earmark for the Olmsted Dam project in last night’s budget deal.”

“Sen. Feinstein and Sen. Alexander have publicly stated that the project was through their (Senate Appropriations) subcommittee,” McConnell spokesman Don Stewart told msnbc.com.

In an investigation last year, Congress’s fiscal watchdog agency, the Government Accountability Office, found that the Olmsted project “is affecting the Corps’ ability to rehabilitate other navigation projects across the country as costs for the replacement have escalated from $775 million (in 1987 dollars) to the current project estimate cost to complete of $2.9 billion.”

Adjusted for inflation, $775 million in 1987 dollars would be equal to $1.6 billion in today’s dollars.

Through fiscal year 2011, the project had already gotten $1.4 billion in funding.

The Army Corps of Engineers, which expects the project to be finished in 2024, said the costs have soared partly because the initial cost estimate was too low and because of daunting construction conditions, calling it “an extremely complex and challenging construction project that is located where the Ohio River elevation can fluctuate up to 50 feet annually.”

The cost of the project is evenly split between taxpayers and the navigation industry which pays a tax on diesel fuel. The diesel tax revenues go to the Inland Waterways Trust Fund.